Companies that experience rapid sales growth have to purchase and stock inventory months in advance of shipment to retailers and distribution partners. This eats up a company's cash. And just when customers get around to paying for past products and services, the company has to invest its available cash in the next inventory build-up. Fast-growing companies also pay out higher sales taxes and insurance bills too. This is how too much success can quickly lead to an empty bank account.

Sadly, if a commercial bank doesn't step in to help a company catch up, the company may have to lay off workers, cut back production or face bankruptcy. This scenario is the living nightmare of American business today and it happens every day.

When entrepreneurs come up with a new product or service idea, it is customary for them to estimate the size of the customer market, check out competitors and design the final product in such a way to maximize profitability and customer appeal. Smarter entrepreneurs consider the timing of cash needs in their planning too. If the balance of incoming and outgoing cash is too tight, they have time to alter their plans to avoid a cash flow crisis if they plan ahead.

No. 2: Limit Exposure to High-Risk Customers.

Are your largest customers also your company's slowest paying customers? If so, take immediate steps to diversify the customer mix to favor faster paying customers. Sales commission payments should be tied to the timing of customer collections too. Sure you may loose some sales, but isn't that better than never getting paid for those sales?

No. 3: Bill Frequently. 

Most service-oriented businesses bill on a monthly basis or at the end of a project. Why not bill customers every week or every two weeks in the form of progress payments? The faster you can invoice customers, the faster you will get paid.

No. 4: Reduce Your Dependence on a Single Funding Source.

As too many entrepreneurs have learned, it's relatively easy for banks to pull credit lines when your company can least afford it. To minimize the risks of sudden cash shortfalls, smart entrepreneurs set aside one or two credit cards for emergencies. More established companies maintain relationships with multiple banks and take every opportunity to network to credit officers from big and small banks.

The first time a lending officer learns about your company should not be the day you are desperate for cash. If you don't know the names of at least four bank credit officers, ask your business colleagues for referrals now!

No. 5: Streamline Your Product Lines.

Entrepreneurs who don't have a lot of loose cash should avoid producing or carrying inventory in too many products in too many styles to sell to too many different types of customers. The more complex a company's product line, the more cash that is required to produce, store, advertise and deliver goods to customers.

No. 6: Focus On High Profitability Standards.

The companies that are most vulnerable to financial heartaches during a recession or credit crisis are low profit margin businesses. Simply stated, low margin businesses have no margin for error. Don't be shy about axing products or services that don't match or exceed your industry's average profit margins.

There is another reward for entrepreneurs who emphasize cautious cash management in their day- to-day business operations. Lenders and investors will want to work with them.

 
Commonly Overlooked Tax Deductions 

Some states have very low or even no income taxes. If you're lucky enough to live in one, make sure to add up all the state and local sales tax you paid in 2011, (especially if you bought a big item like a car or made major purchases for a home renovation), because it's a tax deduction. If you already pay state income taxes, they are most likely much higher than your total sales tax, and, you can't claim both. Also, don't forget to deduct the state and local income and property taxes you paid in 2011 as well. 

Healthcare Insurance Premiums

Especially if you're self-employed, paying your own health insurance can be a four-figure bill every month. Add up all the premiums you paid for the year as well as any other medical expenses to claim your healthcare costs deduction. If you're self-employed, the need to have this total exceed 7.5 percent of your AGI does not apply. However, even if you're a full-timer, you may be paying hundreds every month in premiums. Add these up, plus your other medical expenses and should they add up to more than 7.5% of your AGI, you can take the deduction as well.  

Job-search expenses:

If you were looking for a job in the same line of work this past year, make sure to add up your job-hunting expenses, such as travel, resume prep, or placement agency fees. Job-relocation costs count here as well. If these expenses exceed 2 percent of your AGI, claim your deduction. 

Donations:

Charitable donations of cash are definitely deductions but don't forget other non-cash items you've given as well. If you donated clothes, toys, household goods and food, make sure you have a receipt from the organization so you can claim a deduction.

Higher-education:

College costs are so high, might as well soften the bite with up to $4,000 in tax deductions you can claim for college or professional school tuition, fees and more. There are income limits, however--$80,000 AGI for a single tax filer and $160,000 for joint filers.